Administrative Measures On Foreign Investor For Strategic Investment In Listed Companies

Original Language Title: 外国投资者对上市公司战略投资管理办法

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(December 31, 2005 Commerce, and China Securities supervision Management Committee, and national tax General, and national business administration General, and safe makes 2005 28th, announced since announced of day up 30th Hou purposes) first article to specification share reform Hou foreign investors on shares listed company (following referred to listed company) for strategy investment, maintenance securities market order, introduced outside advanced management experience, and technology and funds, improved listed company governance structure,
    Protection of the legitimate rights and interests of the listed companies and shareholders, in accordance with the requirements of the guidance relating to the share-trading reform of listed companies, according to the national laws on foreign investment, listed companies regulation law and the provisional regulations on mergers and acquisitions of domestic enterprises by foreign investors, these measures are formulated.
    Second approach applies to foreign investors (hereinafter investors) completed the split share structure reform of listed companies and after the reform of non-tradable shares of newly listed companies through medium-and long-term strategic investments with a certain scale (hereinafter referred to as strategic investments), the acquisition of the company's a-shares.
    Article approved by the Ministry of Commerce, the investor can make strategic investments in listed companies based on these measures. Fourth article strategy investment should followed following principles: (a) comply with national legal, and regulations and the related industry policy, shall not against national economic security and social public interests; (ii) insisted public, and just, and fair of principles, maintenance listed company and shareholders of lawful rights and interests of, accept Government, and social public of supervision and the China of judicial and arbitration jurisdiction; (three) encourages medium-and long-term investment, maintenance securities market of normal order, shall not hype; (four) shall not hamper fair competition,
    Shall not cause related products in China and market concentration, eliminate or restrict competition.
    Fifth article investors for strategy investment should meet following requirements: (a) to agreement transfer, and listed company directed issued shares way and national legal regulations provides of other way made listed company shares shares; (ii) investment can staging for, first investment completed Hou made of shares proportion not below the company has issued shares of 10%, but special industry has special provides or by related competent sector approved of except; (three) made of listed company shares shares three years shall not transfer;
    (D) laws and regulations on foreign-invested shareholding has a clearly defined industry, investors hold the shares shall be in conformity with the relevant provisions are regulations prohibit foreign investment in the fields of law, investors not to invest in listed companies in those fields (v) related to State shareholder of listed companies shall comply with the relevant provisions of the State-owned assets management.
    Sixth article investors should meet following requirements: (a) law established, and business of foreign corporate or other organization, financial sound, and funding letter good and has mature of management experience; (ii) outside real has assets total not below 100 million dollars or management of outside real has assets total not below 500 million dollars; or its mother company outside real has assets total not below 100 million dollars or management of outside real has assets total not below 500 million dollars; (three) has sound of governance structure and good of internal control system, business behavior specification;
    (D) in the past three years have not received major penalties in domestic and foreign regulators (including the parent company).
    Seventh article through listed company directed issued way for strategy investment of, by following program handle: (a) listed company Board through to investors directed issued shares and the company articles modified draft of resolution; (ii) listed company shareholders Assembly through to investors directed issued shares and the modified company articles of resolution; (three) listed company and investors signed directed issued of contract; (four) listed company according to this approach 12th article to Commerce submitted related application file, has special provides of from its provides;
    (E) Commerce investors in listed companies to make strategic investments made after reply principle, listed company introduction application file submitted to the CSRC, CSRC approval; (f) the introduction is completed, the listed company to the Commerce Department to get approval certificate for foreign-invested enterprises, and pursuant to the certificate of approval to the Administrative Department for industry and Commerce for registration of change. Eighth article through agreement transfer way for strategy investment of, by following program handle: (a) listed company Board through investors to agreement transfer way for strategy investment of resolution; (ii) listed company shareholders Assembly through investors to agreement transfer way for strategy investment of resolution; (three) transfer party and investors signed shares transfer agreement; (four) investors according to this approach 12th article to Commerce submitted related application file, has special provides of from its provides; (five) investors shares listed company of,
    After obtaining the approval of the foregoing apply for transfer of shares to the stock exchange confirmed procedure, apply to the securities registration and clearing institutions for registration of transfer procedures, and reported that the China Securities Regulatory Commission for the record; (vi) after the transfer is complete, the listed company to the Commerce Department to get approval certificate for foreign-invested enterprises, and pursuant to the certificate of approval to the Administrative Department for industry and Commerce for registration of change. Nineth article investors intends through agreement transfer way constitute on listed company of actual control, according to eighth article subsection (a), and (ii), and (three), and (four) items of program get approved Hou, to China SFC submitted listed company acquisition report book and the related file, by China SFC audit no objections Hou to Securities Exchange handle shares transfer confirmed procedures, and to securities registration settlement institutions application handle registration transfer procedures.
    After completing the above procedures, in accordance with the eighth paragraph (f) shall be followed.
    Tenth investors in listed companies to make strategic investments, shall be governed by the Securities Act and the relevant provisions of the CSRC reports, notices and other statutory obligations.
    11th for which an investor has to hold shares of listed companies continued to make strategic investments, according to the modalities and procedures as provided herein.
    12th article listed company or investors should to Commerce submitted following file: (a) strategy investment applications (format see annex 1); (ii) strategy investment programme (format see annex 2); (three) directed issued contract or shares transfer agreement; (four) sponsor institutions submissions (involved directed issued) or legal submissions; (five) investors continued holding of commitment letter; (six) investors three years within not by both inside and outside regulatory institutions major punishment of statement, and whether by other non-major punishment of description;
    (Seven) by law notary, and certification of investors of registered registration proved, and statutory representative people (or authorized representative) identity proved; (eight) by registered accountants audit of the investors near three years to of balance sheet; (nine) above (a), and (ii), and (three), and (five), and (six) items in the provides submitted of file are needed by investors statutory representative people or its authorized representative signed, by authorized representative signed of also should submitted by statutory representative people signed of authorized book and the corresponding of notary, and certification file;
    (10) other documents stipulated by Ministry of Commerce.
    The files that are listed in the preceding paragraph, apart from the documents listed in the seventh, the eighth, must be submitted in the original text, seventh, eighth file listed should submit original and English translation.
    Ministry of Commerce received all of these files should be made in the 30th after official approval by the principle approval valid for 180 days.
    13th article in accordance with the provisions of article sixth of foreign companies (the "parent company") through its wholly owned subsidiaries ("investors") make strategic investments, investors in addition to the documents listed in article 12th, should also be submitted to the Ministry of Commerce told investors its parent company investments bear joint and several liability of the irrevocable commitment letter. 14th investor shall, within the Ministry of Commerce approval date of 15th according to merger and acquisition with foreign investment shall open foreign exchange accounts.
    Investors remitted from abroad for the strategic investment of the Exchange Fund should be based on the relevant provisions of the Foreign Exchange Management, to the listed company's place of incorporation of the Exchange Council apply to open special foreign exchange accounts foreign investors (acquisition), the funds in the account settlement and account cancellation procedures by reference to the relevant exchange control regulations.
    15th investor may hold the Commerce Department approval of the investor for strategic investment in listed company files, and valid identification to the securities registration and clearing institutions go through the relevant formalities.
    For investors prior to the split share structure reform of listed companies to hold non-tradable shares, or before the initial public offering of shares in listed companies, securities registration and clearing institution may apply according to the investor to open a securities account.
    Securities registration and settlement organizations shall adopt corresponding provisions under this management approach.
    16th an investor should start within a cash settlement date of 15th strategic investment behavior, and to be completed within 180 days from the date of official approval by the strategic investment. Investors could not be completed within the specified time according to the strategic investment programme of strategic investment, approval authority for official approval by the void.
    Investors should in principle approval within 45 days from the date of failure, by the Exchange Council approved the foreign exchange settlement in RMB acquired funds to buy and remitted.
    17th strategic investment completed 10th listed company with the following documents to the Ministry of Commerce to get foreign-invested Enterprise approval certificate: (a) the application; (b) the letter of Ministry of Commerce approved; (c) the certificate of shares issued by the securities registration and clearing institution; (d) the listed company's business license and proof of identity of the legal representative; (v) listed company regulation.
    Commerce Department on the date of receipt of all documents within 5th to issue approval certificate for foreign-invested enterprises, raise "foreign-invested joint stock company (a-share merger)".
    As investors made a single listed company 25% or more shares and promised continued holding of not less than 25% in 10 years, issued by the Ministry of Commerce in notation on a certificate of approval for foreign-invested enterprises "foreign-invested joint stock company (25% a-share mergers and acquisitions or above)". 18th the listed company should be since foreign-invested Enterprise approval certificate issued within 30th of, types of industrial and commercial administration authorities apply for company registration, and submit the following documents: (a) application for amendment of an application signed by the legal representative of the company, (ii) certificate of approval for foreign-invested enterprises; (c) a securities registration and clearing institution issuing shareholding certificates;

    (D) the incorporation certificate of the investor notarized, certified and (e) provisions of the State administration for industry and commerce shall be submitted to the other file.
    Approved change of Administration for industry and commerce business license business type filling in the column "foreign-invested joint stock company (a-share merger) the words", in which investors make strategic investments made a single listed company 25% or more shares and promised continued holding of not less than 25% in 10 years, raise "foreign-invested joint stock company (25% a-share mergers and acquisitions or above)". 19th a listed company shall from the date of issuance of the business license of foreign invested enterprises within the 30th, taxation, customs, Foreign Exchange Administration and other relevant departments of related procedures. Foreign Exchange registration certificate issued by the administration of foreign exchange on the notation on a "foreign-invested joint stock company (a-share merger)".
    Make strategic investments as investors made a single listed company 25% or more shares and promised continued holding of not less than 25% in the 10 years, Foreign Exchange Management Department noted on a foreign exchange registration certificate "foreign-invested joint stock company (25% a-share mergers and acquisitions or above)". 20th article except following case outside, investors shall not for securities sale (b except): (a) investors for strategy investment by holding listed company shares shares, in its commitment of holding term expires Hou can sold; (ii) investors according to securities method related provides must to offer way for acquisition of, in offer during can acquisition listed company shares shareholders sold of shares; (three) investors in listed company share reform Qian holds of non-circulation shares,
    Completed in non-tradable share reform and restricted the flats can sell; (d) the investor before the initial public offering of shares in listed companies, after expiration of the restricted sale; (e) before the expiration of shareholding commitment to investors, because of its bankruptcy and liquidation, mortgages, and other special reason required to transfer its shares, approved by the Ministry of Commerce may be assigned.
    Article 21st investors to reduce its stake to foreign shares of listed companies is lower than 25%, the listed companies should register at the Ministry of Commerce and in the 10th foreign-invested Enterprise approval certificate procedures related to such changes.
    Investors to reduce its stake to foreign shares of listed companies is less than 10%, and the investor's single largest shareholder, a listed company shall be to the approval authority for the record in the 10th and the cancellation of enterprise with foreign investment approval procedures related to. 22nd investor share reduction makes the foreign shares of listed companies is lower than 25%, listed companies should be since foreign-funded enterprises approval certificate changes within 30th of the industrial and commercial administrative organs for registration of changes, adjust the industrial and commercial administrative organs in enterprises in the business license types to "foreign-invested joint stock company (a-share merger)".
    Listed companies should be since the date of business license change in the 30th to the administration of foreign exchange changes the register notation on the administration of foreign exchange on foreign exchange registration certificate "foreign-invested joint stock company (a-share merger)". Investors to reduce its stake to foreign shares of listed companies is lower than 10%, and the investor is the single largest shareholder, listed companies since foreign-invested Enterprise approval certificate cancellation within 30th of the industrial and commercial administrative organs for registration of changes, corporate type change for the limited.
    Listed companies should be since the date of business license change in the 30th to the Foreign Exchange Management Department for foreign exchange registration procedures. Article 23rd, through its wholly-owned subsidiaries of the parent company undertakes strategic investment and has been completed, before transfer of the above subsidiaries of the parent company should be reported to the Ministry of Commerce, and according to the procedures set out in these measures apply.
    New licensee shall remain subject to the conditions set out in this way and assume listed parent companies and their subsidiaries in the company of all of its rights and obligations, and perform to the CSRC reports, announcements, and other statutory obligations.
    24th article investors through shares market will by holding listed company shares transfer of, can by following file to listed company registered location Exchange Council application purchased meeting meeting out: (a) written application; (ii) for strategy investment purpose by open state of foreign investors dedicated Exchange account (acquisition class) within funds by Exchange Council approved settlement of approved pieces; (three) securities brokers institutions issued of about securities trading proved file.
    25th the investor holds less than 25% of listed companies, its borrowing by foreign-funded enterprises borrowing regulations.
    26th personnel of relevant government agencies must be devoted to their duties, and to perform their duties, duties must not be used to obtain illegitimate interests, and knowledge of commercial secrets confidential.
    27th Hong Kong S.A.R., and Macau S.A.R., and Taiwan investors to make strategic investments in the area of, these rules shall apply by analogy.

    28th article of the approaches implemented since the release date of 30th.
                              Appendix 1: applications for strategic investment, the investor name two, three objective listed company name, investment intentions (investors and authorized representative's signature) date annex 2:

                                   Strategy investment programme a, and investors name and the itself situation introduction (mother company through its full funding has of outside subsidiary for strategy investment of also should provides mother company of related material) II, and target listed company name, and business range, intends made company shares of specific way, and intends made of shares number and the made Hou accounted for listed company has issued shares of proportion, and strategy investment time three, and continued holding term four, and investors and target listed company holding shareholders of associated relationship description (投资者及授权代表签章)

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